Which of the Following Constitutes Valid Consideration

question 10

Multiple Choice

Which of the following constitutes valid consideration?

• A)A promise to refrain from doing an illegal act
• B)Past performance
• C)A promise to refrain from doing an act that can be lawfully done
• D)A promise to do what one is already obligated to do

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Definitions:

Cash Disbursements

Outflows of cash for expenses, or payments made by a business during a specific period, such as paying suppliers, employees, or other expenditures.

Financial Statements

Consolidated documents that provide an overview of a company's financial condition, including the balance sheet, income statement, and cash flow statement.

Errors

In accounting, errors refer to mistakes made in recording, classifying, or summarizing financial transactions and statements.

Credit Sales

Sales transactions where the payment is deferred to a future date, typically allowing the buyer to purchase goods or services on credit.